BlackBerry revenue falls below US$1 bil.

TORONTO -- BlackBerry reported a steep drop in profit and revenue Friday as it transitions from a smartphone company to a software business under its new chief executive. Shares jumped 7 percent in premarket trading as CEO John Chen cut expenses quicker than expected.

The Canadian company lost US$423 million, or 80 cents per share. Adjusted for one-time items, however, the company lost 8 cents per share, much better that the losses of 56 cents per share that Wall Street had expected, according to a poll by FactSet.

Revenue fell to US$976 million, the first time the company has seen revenue fall below US$1 billion since late 2007, and short of the US$1.1 billion analysts had projected. Blackberry reported revenue of US$2.7 billion in the same quarter last year.

It is the second quarterly results under Chen, who is deemphasizing the hardware business after last year's launch of the BlackBerry 10 failed to spark a turnaround. The BlackBerry has been hammered by competition from the iPhone as well as Android-based rivals.

“The guy is on the move fast,” said Colin Gillis, an analyst at BGC Partners. “He can control expenses but you can't magically make revenue happen.”